Diners tell restaurants how to drum up more business
Coupons and discounts will always have a place in the food-service industry, but a panel of restaurant-goers say there are factors other than price that could motivate them to dine out more frequently. Increased access to calorie counts and other nutritional information at restaurants would influence how often they visit and the quick-service restaurant (QSR) and fast-casual restaurant categories, according to a study conducted by Radius Global Market Research, New York, among its panel members about their dining behavior in the first three months of 2011. These health-oriented communications led all other consumer recommendations.
Diners in all categories said that between-meal and late-night snacks are popular in QSRs and more than one in five would visit more if offerings were increased. Fast-casual eaters want a wider variety of both chicken and breakfast menu items and almost one-fourth of fast-casual diners said they’d likely act on promotions delivered via social media networks like Facebook and Twitter. In the casual-dining category diners say they’d come more often for unique premium burgers. Customers visiting fine-dining establishments prove the toughest to motivate as nearly half of respondents indicated that their current habits could not be changed by anything other than price. Nearly two-thirds of respondents said they’d be willing to dine out more often if restaurants acted on their suggestions.
The influence of other factors is on the rise but the food-service industry shouldn’t abandon discounts and coupons any time soon. Coupons continue to be the primary way that consumers control spending when dining out. Respondents expect deals and coupons across all food-service categories, including fine-dining. And a vast majority of diners (86 percent) say they find ways to trim the bill each and every visit, up 10 percent since 2009. For more information visit www.radius-global.com.
Pre-research a key part of the shopping ritual
Consumers overwhelmingly rely on online reviews and price comparisons to research products and services before making a purchase. Less than one-third of respondents said they had not conducted online pre-purchase research, such as comparing price or investigating online reviews before buying a product, while the majority (62 percent) read reviews online, according to a survey by Lightspeed Research, Warren, N.J. Forty-nine percent of consumers researched competitors and the same number checked price comparison sites.
Despite the popularity of Facebook and Twitter, only 7 percent of survey respondents look for product reviews from friends on social networking sites. “Despite their role in our digital lives, social networks don’t yet seem to be the place where word-of-mouth is delivering its full power,” says Naor Chazan, marketing director, Americas, at Lightspeed Research.
Consumers turn most readily to search engines (64 percent), shopping Web sites (58 percent), the Consumer Reports Web site (54 percent), company Web sites (47 percent), review communities (32 percent); magazines (24 percent); forums/blogs (22 percent), shopping comparison sites (21 percent) and newspapers (16 percent) for their research.
Almost three-quarters of respondents said they trust Consumer Reports, followed by the opinions and experiences of other consumers (62 percent) and recommendations from family, friends and colleagues (58 percent).
Twenty-one percent of the people surveyed said they change their minds about buying a product or service after reading two bad reviews and 37 percent said reading three negative reviews would persuade them against buying a particular product or service.
Respondents research everything imaginable, from expensive products such as cars, personal technology and home appliances, to less expensive items like books, films, clothes and games. It’s the same story for services. Hotel accommodation is the top researched service at 66 percent, followed by mobile phone companies, insurance and banks/financial services. For more information visit www.lightspeedresearch.com.
Government finances worry Americans most
Nearly three-fourths of Americans worry about the economy a great deal more than they worry about 13 other issues (i.e., affordable health care, unemployment, crime and violence, illegal immigration, terrorism, drug use, etc.), according to a poll from Washington, D.C., research company Gallup.
Sixty-four percent worry a great deal about federal spending and the budget deficit but show the least anxiety about race relations - the only issue about which the majority is only a little or not at all concerned.
The availability and affordability of energy is the only issue about which Americans have grown significantly more worried since 2010, from 38 percent to 46 percent. The current level of concern about this is similar to what it was from 2006 to 2008.
The economy and unemployment are top-ranking concerns for Republicans, Independents and Democrats. Additionally, majorities of Republicans and Democrats are highly worried about Social Security. Beyond these areas of common concern, however, the parties diverge. Large majorities of Republicans say they worry a great deal about federal spending (79 percent) and the size and power of government (62 percent) and 55 percent worry a great deal about immigration. All of these issues are absent from Democrats’ top concerns. In contrast, Democrats’ top-ranking issue - health care - is not a great concern to most Republicans.
Among the four issues of concern to a majority of Independents, the economy and unemployment are issues they have in common with both major parties, while federal spending is primarily a Republican concern and health care, a Democratic one.
Also of note, women are significantly more likely than men to be worried about health care, hunger/homelessness, Social Security, crime, unemployment, the environment and drug use.
Young adults ages 18-to-34 are significantly less likely than older Americans to be concerned about Social Security and the size and power of the federal government. Young adults are significantly more likely to be concerned about the quality of the environment. For more information visit www.gallup.com.
No pleasure cruise: Gas prices driving consumers off the roads
As the national average for a gallon of gas edges over $4 per gallon consumers have cut back on their driving. Gallons of gas purchased are down 1.2 percent from a year ago, indicating that consumers are driving less, according to data from Port Washington, N.Y., research company The NPD Group. An NPD survey from January 2011 to gauge what price level would be required to cause consumers to drive less suggests that at today’s gas prices approximately 60 percent of consumers are cutting back on driving.
“If the current uptick in gas price is sustained, we can expect consumers to begin implementing some key changes like reducing or consolidating shopping trips, taking more mass transit and carpooling,” says David Portalatin, industry analyst, automotive aftermarket, at NPD. “In the case of a prolonged spike above $4, we’d expect even more significant changes like working from home, relocating or changing jobs or driving a more fuel-efficient vehicle.”
Based on recent history in 2008 when gas reached a high of $4.16 per gallon, research shows that drivers made significant changes in driving behavior including 49 percent who reduced or consolidated shopping trips, 29 percent cancelled or modified vacations and 25 percent found alternate means of transportation including mass transit, carpooling and riding a bike. For more information visit www.npd.com.
Losing customers? Look at what’s happening on the ground
Companies spend billions each year on advertising but recent research indicates that ad dollars may be better used to improve customers’ personal experience. Only 4 percent of Americans trust advertising the most as an information source when choosing products or services and factors that have an immediate impact on the customer’s personal experience with a company were the primary reasons consumers gave for defecting, according to a survey from San Mateo, Calif., research company Satmetrix. Bad customer experience forced 22 percent of consumers to stop doing business with a provider during the second half of 2010.
Interacting with a rude or disinterested employee was cited most frequently (34 percent) as a reason for switching brands, while 20 percent said they switched because of unexpected charges or fees and the same number listed poor product or service quality as the main reason. Factors with a less-immediate impact caused fewer defections, such as having an unfavorable return or refund policy (3 percent of consumers).
The data also revealed that consumers most trust recommendations from independent sources (83 percent), especially those with whom they have personal relationships. Half of consumers (50 percent) cited personal recommendations from friends, family or colleagues as the most trustworthy source of information. Approximately four times as many people trusted product test reviews (18 percent) or consumer opinions posted online (15 percent) as compared to advertising. Additionally, 49 percent of all consumers referred friends or colleagues to a company they had a positive experience with in the past 12 months, while 10 percent advised against doing business with a company. For more information visit www.satmetrix.com.
Affluent consumers welcome discounts on prestige brands
Discounts by prestige brands during the past two or three years of a weak economy have apparently been accepted by affluent and luxury consumers without diluting the stature of the brands. About 60 percent of the affluent say the discounts did not affect their opinion of the brands, while a quarter said the discounts motivated them to make purchases they may not have otherwise made, according to the American Affluence Research Center, Alpharetta, Ga. Only 5 percent said the discounts lowered the image/prestige of the brand.
This data suggests that the affluent recognize there are certain situations where discounting by prestige brands is reasonable and understandable, if not part of an ongoing practice. About half said discounts seemed to be a reasonable way to maintain sales during the past few years.
Less than 20 percent said the discounts raised potentially negative issues. These were questions about whether quality had been lowered to offset the discounts and whether prior prices and profit margins were fair. Similar responses were elicited when asked about discounts that prestige brands communicate via the Internet or mobile devices only to past customers or to members of special flash sale sites. For more information visit www.affluenceresearch.org.
Consumers are foggy about the cloud
While nearly half of consumers are aware of the cloud, only 9 percent acknowledge that they fully understand it, according to data from GfK Business and Technology, a division of GfK Custom Research North America, New York. A lack of understanding has also raised concerns among the befuddled masses, with data security topping the list of worries.
The term cloud computing is used to describe applications and services hosted and run on servers connected to the Internet that end users do not have to maintain or support. Consumers are increasingly in need of cloud-based services with data spread across multiple devices, including laptops, cell phones and tablet computers.
Interest in storing data within the cloud is significantly higher in younger consumers, with approximately 60 percent of users ages 18-to-35 interested in moving their data to the cloud. In older age groups, that number drops significantly, with only an average of 25 percent of users over the age of 50 interested in moving their data to the cloud.
There are also concerns among consumers about moving their data to the cloud. Nearly two-thirds of consumers said that they are concerned about the security of their content if they were to store it in the cloud. Additionally, 47 percent of consumers surveyed said they would never use the cloud unless they have a simple and easy way to store their content, while 39 percent are concerned about the ability to play content on different devices from the cloud. For more information visit www.gfkamerica.com.
Ladies look to financial advisors for guidance
Women are becoming a force to be reckoned with in the financial world. The number of women who say they have a self-directed investment account is not significantly different from the number of men who say the same (30 percent of women and 36 percent of men) yet women are much more likely than men to look to a trusted advisor to give them investment ideas, according to Chicago research company Mintel.
Thirty-nine percent of female investors’ primary source of investment ideas are their investment advisors, compared to only 27 percent of males. Women are also slightly more likely to solicit ideas from friends and family members (29 percent of females vs. 22 percent of males).
Men, on the other hand, are most likely to look to financial Web sites and blogs (38 percent) or the investment company’s Web site (31 percent). They are also much more likely than women to look to newspapers or magazines for inspiration. For instance, 27 percent of males like to read financial newspapers such as The Wall Street Journal (either print or online), while only 17 percent of females claim the same. For more information visit www.mintel.com.